As urban Indians grow to prefer high-end brands over beers with a high alcohol level, India’s largest beer brand, Kingfisher, is losing market share to premium overseas brands.
According to data from market research firm Euromonitor, Kingfisher, India’s top-selling beer brand, lost 4.3% of the market between 2011 and 2016. Among the leading beer brands in India at the moment, this decline is the most pronounced.
Anheuser-Busch InBev NV, the largest producer of alcoholic beverages in the world, and the Danish brewer Carlsberg A/S have meanwhile seized the opportunity presented by Kingfisher’s downturn. With a market share of 11.1% and an almost five-fold increase since 2011, Carlsberg’s Tuborg brand is currently the second-largest beer by volume in India. Carlsberg, the company’s flagship beer, is also included on the list; according to Euromonitor data, its market share has increased by a factor of two to 5.8% since 2011.
Anheuser-Busch Budweiser, the primary beer brand of InBev, had its market share increase nearly five times from 2011 to 4.9% in 2016. With SABMiller Plc’s brands, the English brewer of alcohol that merged with AB InBev in 2016, AB InBev has also improved its market position. According to Euromonitor, Haywards, the third-largest beer by volume in India, is now owned by AB InBev and is worth 10.7% of the market. But this percentage had decreased since 2011 when it reached 14.6%.
Most of these brands are promoted in conjunction with music festivals and other events that cater to the youthful urban working population and are positioned as premium urban beers. While Carlsberg sponsors events like the UEFA Euro in India, Budweiser sponsors music festivals like Electric Daisy Carnival and Tomorrowland.
According to market research company BMI Research, the influx of these brands has diminished United Breweries’ dominance over the Indian beer industry, which is predicted to increase at a CAGR (compound annual growth rate) of 7.5% between 2017 and 2021. According to data from Euromonitor, UB’s overall market share among the top 23 beer brands in India, comprising its seven powerful brands, was 44.1% in 2016, down from 50.1% in 2011. The business nonetheless continues to dominate the Indian beer market. According to Euromonitor, AB InBev had a 24.6% share by volume in 2016, and Carlsberg has a 16.9% overall share.
The representative for United Breweries has yet to respond to emails.
“It is evident that SAB joining forces with AB InBev makes it a powerful competitor, with a portfolio of solid beers as well as mild beers, in the mainstream as well as in the premium space,” United Breweries’ chief financial officer, Steven Bosch, stated in a conference call with investors on November 9.
“We have our portfolio to compete with it, so it is a strong competitor,” To take advantage of the growth in the craft beer market in major metropolises, the company has introduced premium beer brands such as Desperados, Sol, Dos Equis, and a few others, he said. Other brands include Delhi-based Bira91. Heineken, a Dutch brewer that controls more than 40% of the company, owns these brands.
However, Kingfisher continues to be the company’s primary market, with variants like Kingfisher Premium and Kingfisher Strong, according to Bosch. According to a July 17 article in Mint, AB InBev India relies on Budweiser to drive the company’s expansion in the country with premium positioning and a concentration on Tier I and now Tier II cities.
According to Carlsberg’s most recent annual report for the calendar year 2016, India, together with China and Vietnam, contributes 10% of the group’s operating profit, which amounts to 8.3 billion Danish kroner (Rs 8,471 crore).
A Carlsberg India official did not respond to emails.